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Mortgages for Retirement Properties

Our Mortgage Service - helping you make the right decision

"The essence of the Fair Mortgages service is professional independent mortgage and protection advice brought to you by a team of specialist advisers and experienced administration support. 

As your mortgage is such an important transaction, good advice is imperative.

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"We know that the internet is the first port of call for many people when looking for mortgage solutions; our view is, yes use the internet to do your own research , but then bring it to us and we’ll let you know how your findings compare and then give you the information and advice you need - so that you can make the right decision for your future.” Adam Arnott, Head of Mortgages & Protection

Find the best mortgages for retirement properties 

Retirement properties tend to be available on a rental basis, but there are some instances where you may be able to buy a retirement home either outright using your savings, or using a mortgage. However, getting a mortgage for a retirement property can be difficult and will often require that you seek specialist advice.

Buying retirement properties – the basics

If you want to buy a property in a retirement village, apartment block or housing development, the way in which the property is sold is likely to be broadly similar to that of any other block of flats – the individual flat or house will be sold on a leasehold basis. This means that you have purchased the right to live in the property for the duration of the lease. Most leases are several decades in length, and generally speaking, the longer the lease, the better, as you will not need to worry about renewing it in the future.

Once you have bought a retirement property you will be liable for several ongoing charges. These costs could include:

  • Annual ground rent, which is payable to the freeholder
  • A service charge each year to pay for the management company  – this will generally cover costs like buildings insurance (you will generally need to arrange your own contents insurance), maintenance and cleaning for communal areas, grounds maintenance, and repairs to the overall structure of the buildings
  • Depending on the type of retirement property you choose, you may also encounter extra charges for nursing care, meals, or onsite activities

Can I buy a retirement property with a mortgage?

Technically, it is possible to buy a retirement property with a mortgage. While many high street mortgage lenders will not lend to borrowers over a certain age or will ask that the mortgage be paid off by a specified age, there are some specialist mortgage brokers who will offer mortgages to people on repayment terms that go up to the age of 90. Despite this, getting mortgages for retirement properties can be a difficult proposition, for two main reasons:

Firstly, getting a mortgage for leasehold properties can often be a little more challenging than getting a mortgage for a freehold property., regardless of whether it is a retirement property or not. Some lenders refuse to offer mortgage on certain kinds of flats or apartments, and this may include retirement properties. Secondly, many mortgage lenders look for resale potential when they consider whether to offer a mortgage deal – and retirement properties have a limited target market and therefore a limited resale potential as far as many mortgage lenders are concerned.

Find the right retirement property mortgage deal for you

If you want to buy a retirement property using a mortgage, you may find that the process is easier if you obtain specialist, independent advice before making a decision. Our dedicated whole of market mortgage team can help you to locate the right mortgages for retirement properties for you – call us today on 0117 332 3389 or to speak to one of our mortgage advisers click here »

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